A fiscal Red Alert?

If Labour wants to win the next General Election, says Michael Ashcroft after one of his mega-polls, we should convince those who are currently considering Labour that we would be serious about the deficit and fiscal discipline.

The Labour orthodoxy today seems to be that New Labour was a failed experiment, but it wasn’t – as an electoral force, it worked like nothing before or since. Perhaps they should ask themselves what Tony would do.

I think this research clearly shows the strategic path Labour should choose.

But why would they take advice from me?

Lord Ashcroft, Red Alert.

Well, my Lord, I can tell you that asking “What would Tony Do?” is not the best way to win friends and influence people in the New Iteration Next Generation One Nation Labour party.

We’re all about George Lansbury and Disraeli now.

Still, as one of Labour’s merry band of fiscal conservatives, the Ashcroft poll and the “Labour needs to be tough” reportage it created is obviously music to my ears, and I am doing a little dance in the office, singing the “I was right” song.1.

Actually, I’m not. For one thing, as Mark Ferguson argues in Labourlist, the current vote share Labour has today, 42% in the Ashcroft poll, would be more than enough to take Labour to victory.

This is true, and is a datapoint which will no doubt be used by those on the centre-left who are, if fiscally responsible in principle, are also chary of spelling out the precise consequences of fiscal this responsibility in any further detail2

I think many Labour strategists would agree with Ashcroft’s observation about the nature of Labour’s new joiners post 2010.

Many Joiners hit by austerity hope or assume that a new Labour government would restore some or all of what they have lost out on.

This is not based on any specific promise they think they have heard, but on their view of Labour as the party for ordinary people and public services, combined with its opposition to cuts.

Sitting in the Labour leader’s office, that might well read as a warning not to upset the apple cart by banging on about what we’d cut.

“By taking a harder line on cuts we might win a chunk of that 10% of potential Labour voters who are up for grabs. But we’d certainly lose a significant and unknowable share of the 42% who are already supporting us “

However, there are a few problems with that position.

First, the 42% who currently support Labour are not an ever fixed mark that look on tempestuous events and are not shaken. 16% of all Labour voters, and a full quarter of those who have joined Labour since 2010, say they may well change their mind before the next election.

This is likely because a significant minority of current Labour voters have doubts about the difference a Labour government would make.

For example, 40% of current Labour voters think the unemployment rate would be no better or worse if Labour had won the last election, 46% think the overall state of the economy would be no better or worse. A huge 66% say Labour would not have improved the overall level of debt, 67% say we’d have done no better on welfare and benefits, 64% no better or worse on immigration.

Next, among the Labour voters who say they’re unsure about voting Labour, the top two concerns are that we haven’t said what we’ll do to improve things, and that we might spend more than the country can afford.

Further, looking at the polling detail suggests where these doubts lie.

35% of Labour joiners say the Tories are better on the deficit, 39% say th Tories are better on welfare ‘scroungers’. 33% say the Tories are better on immigration. (Indeed, a third of Labour loyalists see welfare as an area where the Tories are better than Labour. I’m sure Mr Osborne would like to build another benefit cap trap for us to walk into.)

This should remind us that our opponents are probably only temporarily asleep.

If I were a Tory reading the Ashcroft polling, I’d be convinced that my General election campaign should consist of three things.

First, a set of bribes clear recognition of the needs of the hard-working family to show they’re in touch (preferably against the backdrop of a recovering economy).

Second, an assault on Labour credibility on welfare, immigration, deficits, debt and the overall economy.

Last, a vicious personal assault on the prospect of Ed Miliband being the next Prime Minister.

The data and the focus groups suggest this approach might well have some traction if Labour does not anticipate the attack.

I’d argue that strategic ambiguity about what Labour would do3 is itself a political risk.

Lord Ashcroft drily notes that his poll reflects his own experience in opposition, where people assumed the Tories would sort out all the things that they wanted to change. This created ‘unmeetable expectations’ that just about survived the election campaign, but has served them poorly in government.

A Labour adviser might equally drily point out that the Prime Minister at least has the problem of meeting those expectations from No 10 Downing Street.

However, for Labour the data also suggests that in polling terms, a lack of fiscal clarity represents a risk not only to Labour considerers, but also to sustaining the current Labour coalition all the way to the next election.

The ‘I was right song’ I learned from a friend of my girlfriend. The lyrics are. “I was right, you were wrong, so I’m going to sing the ‘I was right’ song”. Repeat until punched [↩]

To be clear, this post is strictly a discussion about polling and strategy. However, as I believe the correct Fiscal position for Labour would be clear promises to reduce deficit over time, with higher share of reduction through tax increases and clear restraint in spending, though with cuts more back loaded, but more clearly spelled out cuts, backed up by a fiscal lock to prevent us running deficits during periods of growth, that obviously influences my attitude to the polling [↩]

perhaps by wrapping up vague hopes for change in a big nation, one society banner that people can read what they wish into [↩]

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4 Responses to “A fiscal Red Alert?”

You’re right to a large extent and so is Lord Ashcroft but to effectively say, ‘the deficit hasn’t been used to make a fair number of ideological choices’ doesn’t really fit with the wider story.
The story (and this is a construct of the media which is so important) is that ‘this government is out of touch, doesn’t understand the reality of austerity and therefore isn’t on their side’ and it’s something that has resonanted not least because of the number of examples that make the ‘myth’ look true. You might say ‘politicicans’ don’t need to look, sound and act as though they’re connected to a wider society but it’s clearly a major problem for the coalition.
The fact is they don’t look like ‘they want to be on your side’ and the power of this type of ‘disconnect’ was seen so starkly in Romney’s 47% remark. Just remember the PM’s typically gauche comment ‘the good news will just keep coming’ after he made his latest pre announcement of important information and think how that will come back to haunt him.
The figures as set out in Ashcroft’s poll certainly bear out his interpretation but can also be interpreted in a more sombre way if I was thinking of my coalition for victory in 2015.
The deficit is an interesting issue and we’ve had two and half years of ‘coalition hard sell’ on how and why this is the biggest single issue facing this generation (and probably the next). The fact is nobody is arguing about the deficit, they’re arguing about the choices made within the ‘deficit envelope’ and that’s a coalition (but especially Tory) weakness. The choices look and feel out of kilter and the narrative of media underpins that.
You can’t disregard the choices made by the coalition which is why the Liberals are facing the most difficult question since their last ‘difficult question’ – what is a Liberal Democrat party if it’s not a ersatz version of the Tories on the right or Labour on the left and centre left.
It’s the choices made and the reliance on the ‘there is no alternative rhetoric’ when it’s clear that these are a series of choices made to ‘role back further the post war consensus’. That may be a good thing and it may be necessary but the Tories biggest weakness is they don’t do empathy very well and they are failing the competence test. I’ve resisted the ‘o’ word but Lord Ashcroft managed to get through a whole document without mentioning the word ‘competence’ which deployed along with ‘out of touch’ is a very toxic mix. Just ask GB.

Let’s assume Labour pledges to match the Government’s spending envelope in 2015-17 (as per your argument on twitter). How would we then differentiate ourselves from the Coalition government? Will being on the side of “people like me” be enough?

This morning the Daily Mail ran a story urging readers to boycott Amazon because of their tax avoidance; in the US election, Reagan Democrats in the Mid-West voted for Obama largely because of his bailout of the auto industry; whole swathes of the UK are angry at the socialisation of losses by irresponsible bankers; this generation is the the first to have lower living standards than their parents; youth unemployment is unacceptably high and recent graduates have entered a rank labour market.

I cite these to make a simple point: the world is changing and it’s a mistake to accept strict neo-liberal parameters.

Structural changes to the economy caused by globalisation and the IT revolution are not easily soluble – and certainly can’t be addressed by throwing money at them. However, there is a clear opportunity here for a pragmatic, centre-left government to strike a bargain with the people.

Indeed, to the extent that examples of eg industrial strategy are us inspired by US (I’m thinking bailouts/SBIR/innovation hubs etc) I get a bit frustrated when people describe this as some sort of radical left position!

Your overall Q is a fair one, but i think you answer it yourself: By limited, targeted, pracitcal interventions in areas like industry, innovation and growth policy, combined with a fairly strong approach to holding down public services spending for sustained period, in order ot create fiscal space for growth policy.

Plus, all money goes to feeding our cat, or providing sustenance to those who do. So really, if you don't help, you're evil

Who are you anyway?

My name is Hopi Sen. Really. I worked for the Labour party for seven years and now I don't. You get the benefit of my immense wisdom and knowledge (hem hem). I write about politics as a loyal Labour supporter.